Mexico's Pemex returns to profit despite low oil price

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Pemex, the biggest company in Latin America's second-largest economy, reported net earnings of 1.4 billion pesos ($66 million) for the three months to September
Pemex, the biggest company in Latin America's second-largest economy, reported net earnings of 1.4 billion pesos ($66 million) for the three months to September

Mexican state energy giant Pemex on Wednesday reported its first quarterly profit in two years despite a plunge in world oil prices due to the coronavirus pandemic.

Pemex, the biggest company in Latin America's second-largest economy, reported net earnings of 1.4 billion pesos ($66 million) for the three months to September.

The profit, which Pemex said was mainly thanks to returns on financial derivatives and foreign exchange earnings, compared with a loss of 87.9 billion pesos in the third quarter of 2019.

Revenue fell by 31.8 percent to 239 billion pesos, hit by weaker demand "due to the decline in economic activity as a result of Covid-19 and by the worldwide drop in prices," the company said.

In a further indication of the tough business environment, Pemex said its debt rose to $110.3 billion, from $107.2 billion in the second quarter.

The company has faced years of declining production and needs to invest to boost its output.

Leftist President Andres Manuel Lopez Obrador has sought to help the firm regain its footing with a series of cash injections and other measures.

yug-dr/jm